Implications of 'lockbox' amendment still being examined

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Dec 10, 2016 at 9:40 PMDec 10, 2016 at 11:43 PM

It was popular with lawmakers who voted to put it on the November ballot, and it was popular with voters who overwhelmingly approved it.

Now, both proponents and opponents are wondering if the so-called Safe Roads Amendment to the Illinois Constitution -- also referred to as the "lockbox" amendment -- could carry with it some unintended consequences. The amendment essentially says that transportation-related taxes and fees should only be used for transportation-related purposes.

“I guess time will tell once we get into this,” said Rep. Brandon Phelps, D-Harrisburg, principal House sponsor of the constitutional amendment. “I have said that if there is anything we have to clean up or something that fell through the cracks or what have you, I would be willing to sponsor a trailer bill to clean it up.”

The amendment stipulates that gasoline taxes, driver’s license and license plate fees, along with highway tolls, be placed in a “lockbox” and only used for specific transportation-related expenses.

“I felt it was long overdue,” Phelps said. “This keeps governors and other legislatures in the future from getting their greedy hands on that pot of money to do other special projects. It’s going to go to infrastructure and road projects like it’s supposed to.”

Phelps was referring to the habit of governors and state lawmakers tapping into the state’s Road Fund to help prop up parts of the state budget that having nothing to do with transportation. For example, in 2015, faced with a $1.6 billion hole in that year’s state budget, Gov. Bruce Rauner and the legislature agreed on a plan to use $500 million in transportation money to help plug the hole. The move helped ensure that prison guards were paid on time and state-subsidized day care programs didn’t run out of money.

The Road Fund, one of hundreds of special funds maintained by the state, presents a tempting target. Late last week, the fund had a balance of just over $1 billion.

Hands tied?

The fact the newly approved constitutional amendment will put transportation money off limits if a similar emergency arises in the future led Rep. Elaine Nekritz, D-Northbrook, to vote against putting it on the ballot. She was one of only four lawmakers to vote against the amendment.

“My concerns were just about limiting the ability to govern in times of crisis and enshrining in the Constitution that transportation was like pensions, a priority over everything else that state government does,” Nekritz said. “That seemed like a bad path to me.”

Nekritz said concerns have been raised about the use of state sales tax money raised from gasoline purchases, whether money from the sale of charity license plates can still go to charities and transportation funds raised by school districts.

“This came up, to my mind, fairly quickly and there was not a thorough vetting of all of the various impacts,” she said.

Nekritz is also unsure if the legislature can retroactively fix any problems that arise from the amendment. Nekritz was one of the spearheads on the pension reform law that was declared unconstitutional by the state Supreme Court. She cites that decision as an example of what the court might do if a case involving the transportation lockbox reaches it.

“It (the pension protection clause) says what it says and the courts interpreted it very tightly,” Nekritz said. “I think there is certainly the potential, if not the likelihood, that this clause is interpreted that same way and you can’t change it via statute. It can only be changed via constitution.”

Sales tax questions

Just what the amendment might mean for the state is under review.

“The administration continues to review the effects of the lockbox amendment and what it means for our state agencies,” Rauner spokeswoman Catherine Kelly said in an emailed response to questions about the amendment.

Newly installed Comptroller Susana Mendoza’s office is also reviewing the implications of the amendment, according to spokesman Abdon Pallasch. As comptroller, Mendoza is responsible for maintaining state accounts and paying bills.

One potential side effect is what happens to the sales taxes collected from fuel purchases. In addition to the 19-cents-a-gallon gasoline tax, Illinois imposes the state sales tax on gasoline purchases. The sales tax money, though, goes into the state’s general checkbook account along with other sales tax revenue and income tax collections to pay for general state services.

“If we decide to continue to take the sales tax on gas and put it into general revenue and nobody sues, OK, then there’s nothing to stop us,” Nekritz said. “But at the end of the day, we should try to implement the Constitution in the best way we know how.”

Agency impact

Questions have been raised about the potential impact of the amendment on the Department of Natural Resources. A law passed four years ago added $2 to license plate fees, money that is specifically earmarked for DNR. The agency's spokesman, Tim Schweizer, said the fee raises roughly $20 million a year.

“That is used for state parks operations and maintenance,” he said.

Whether the lockbox amendment will force changes to that is under review.

“We are evaluating its potential impacts on next year’s DNR budget,” was all Schwiezer would say in response to questions.

Some traditional uses of transportation money will continue even though they do not directly involve road construction or repair. The amendment allows money to be spent on some costs of “administering laws related to vehicles” and traffic enforcement.

That’s an issue for Secretary of State Jesse White’s office, which gets a portion of its operations budget from the road fund.

But there were also questions if money raised from the sale of specialty license plates for various charitable causes could still be directed to the charities.

“Our attorneys looked at it, talked with Rep. Phelps, and we are comfortable with the idea to maintain sending the money to the different causes,” said White spokesman Dave Druker.

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